MICC Property Income Fund Limited (MICCPROP) today listed on the Financial – Real Estate sector of the JSE Securities Exchange South Africa. The company placed 66 992 698 linked units at 500 cents per linked unit and the company is predicting a 73.62cents per linked unit distribution and yield (based on a linked unit price of R5.00) of 14.72% at the end of its first financial year as a listed company, being 30 September 2004.

MICCProp’s, primary investment objectives are to invest in properties that have strong cash flows that support geared returns over the medium to long term and that exhibit upside potential in respect of improved property market conditions.

MICCProp intends investing in the following type of assets:

• Retail properties that have a high percentage of well-established national tenants based in centres where anchor tenants have long term lease commitments and enjoy a dominant trading position;
• Outlying retail centres in economically active nodes that are well-supported by the national retailers;
• Larger retail centres that have a good trading history, strong brand recognition and proven growth and sustainability in their rental streams
• Office and industrial properties which at current market rentals will achieve attractive medium-term returns that will also allow MICCProp to benefit from an improvement in these sectors in terms of demand and rental level improvements

Sanlam Property Asset Management is the promoter and outsourced property manager that has sold R280m of its own property assets into the start-up portfolio of 40 properties.

The portfolio is split into retail properties - community shopping centres and strip malls (60%), light industrial mini units (9%) and commercial office space (31%). The properties are located in both South Africa and Namibia, with the Namibian properties making up 13% of the portfolio. The geographical spread of the South African properties favours Gauteng at 48%, with KwaZulu-Natal at 24%, Mpumalanga at 13% and the remaining 15% spread through the country’s other provinces. The portfolio is currently worth R837m with plans to grow the base to approximately R 1,5 bn by the end of 2004.

The portfolio has been acquired from the various vendors for a combination of linked units and cash. The cash required has primarily been sourced from debt funding in an amount of R502 million and a small amount of R66 million  was raised through a private placing.

In accordance with the requisite principles of the King Code, the board of directors comprises a majority of independent, non-executive directors. Gregory Chalmers has been appointed as its Chief Executive Officer, and Messrs Hardie Joubert; Johann de Beer; Mustaq Brey; Pieter Ebersohn and Dries du Toit have been appointed as non-executive directors. Hardie Joubert is the chairman of the board. “Good corporate governance and compliance with the King Code is an important principle which ensures a good corporate citizen” says Joubert.

MICC Prop will complete its secondary listing on the Namibian Stock Exchange (NSX) tomorrow, the 10 October 2003.  “There is a strategic intent in acquiring the Namibian properties as well as listing on the Namibian Stock Exchange. We are looking forward to being listed and based on the very positive response to the private placing, so is the market” says Chalmers.